Budget 2023: Capital investment outlay increased by 33% to Rs 10 lakh crore, says FM Sitharaman

India will focus on economic growth and job creation, Finance Minister Nirmala Sitharaman said on Wednesday presenting the government's last full budget in parliament before a general election due next year. She said capital investment outlay has been increased by 33% to Rs 10 lakh crore, which will be 3.3% of GDP. With this, capital investment outlay has been increased for third year in row. The allocation is higher than the Rs 7.5 lakh crore budgeted for in the previous year and the highest on record. Capital outlay of Rs 2.4 lakh crore has been provided for Railways in FY24, said Sitharaman.

Outlay for PM Awaas Yojana has been increased by 66% to Rs 79,000 crore. Effective capex will be Rs 13.7 lakh crore, forming 4.5% of GDP, said Sitharaman in her budget speech.

The ratio of capex-to-GDP, which rose to 2.7% in 2022/23, is estimated at 3.3% in the new financial year, Finance Minister Nirmala Sitharaman said.

"We have a great leader with a great vision in Narendra Modi who has a firm resolve and determination to transform India into a vibrant economy. This vision is reflected in the budget. The Finance Minister's focus on capital investment to Rs 10 lakh crore, 3.3% of GDP will spur growth. Trust-based governance, simplification of laws and a thrust on green energy is laudable. The fiscal deficit is estimated to go down to 4.5% of GDP, which is a welcome move. Kudos to the Finance Minister for an outstanding budget with a focus on encouraging entrepreneurship. This will propel investment by the private sector. A big thank you to the honourable Finance Minister and honourable Prime Minister for their vision in transforming India," said Sanjiv Goenka, Chairman, RP-Sanjiv Goenka Group.

The aim is to have strong public finances and a robust financial sector for the benefit of all sections of the country, Nirmala Sitharaman said.

"The economic agenda ... for achieving this vision focuses on three things: first, facilitating ample opportunities for citizens, especially the youth, their aspirations; second, providing strong impetus to growth and job creation; and third, providing strengthening of the macro economic stability," she said.

She added that despite a global slowdown because of the COVID-19 pandemic and the Russia-Ukraine war, the Indian economy was "on the right track".

"The 33% higher capital outlay of Rs 10 lakh crore will fast-track implementation of high-multiplier government programmes such Bharatmala, Ghatishakthi, Parvatmala and Sagarmala," said CRISIL.

"The 33% increase in capital investment outlay using gross budgetary support, which has already a strong growth this fiscal, and grants of Rs 3.7 lakh crore are crucial for the infrastructure buildout needed to crowd in private investments and push India towards its $5 trillion economy goal," added CRISIL.